{
  "id": 17455047,
  "title": "CBDT tightens merger rules for charity trusts, imposes five-year curbs on changing objectives",
  "url": "https://urgent.news/2026/10/31/cbdt-tightens-merger-rules-for-charity-trusts-imposes-five-year-curbs",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-10-31T18:29:57.000Z",
  "source": {
    "name": "The Economic Times - Economy",
    "slug": "the-economic-times-economy",
    "url": "https://economictimes.indiatimes.com/news/economy/policy/cbdt-tightens-merger-rules-for-charity-trusts-imposes-five-year-curbs-on-changing-objectives/articleshow/135409569.cms"
  },
  "original_language": "en",
  "account": "The Central Board of Direct Taxes (CBDT) has introduced stricter rules for charitable trusts and non-profit organisations planning to merge. The new regulations, effective from October 30, impose a five-year restriction on altering the objectives of the surviving organisation post-merger. Furthermore, the merged entity must take over the outstanding tax liabilities of the absorbed organisation.\n\nOrganisations merging must notify the Income Tax Department within a deadline, undergo an audit of their accounts, and disclose the reasons behind the merger. Notably, organisations with regular registration cannot merge with those holding provisional registration, and vice versa. This change aims to ensure greater transparency and accountability in the merger process.\n\nUnder the new rules, the surviving organisation cannot change its objectives for five years after the merger. Additionally, the merger must not grant any direct or indirect benefits to specified related persons. The tax department emphasizes that a merger does not absolve the absorbed organisation of its financial or legal responsibilities. All assets, liabilities, and tax obligations of the absorbed organisation will be transferred to the surviving organisation.\n\nTo comply with the new regulations, organisations must file a new Form 112A with the relevant income tax authority within a month after the merger's effective date. The filing must be done online using a digital signature or electronic verification code. Both organisations involved in the merger must also have their accounts audited as of the merger date.",
  "summary": "The Central Board of Direct Taxes (CBDT) has made it mandatory for organisations merging with another registered non-profit to inform the I-T Department within a prescribed deadline, get their accounts audited and disclose the reasons for the merger. The new rules, notified on October 30, also prevent organisations with regular registration from merging with those holding provisional…",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}